Invensys’ vice president of performance management, Dr. Peter Martin, brought his crusade for higher visibility of automation in the enterprise to Foxboro User Group, which kicked off today in Boston.
He talked about the effect of activist boards of directors since Enron and the other CEO debacles, and how CEOs have less than a year in general to perform, or they are gone. “So,” he said, “what do you think these people want from you? They want you to show them that you are worth something. How can you prove to your executives that you are the most valued employees in your company? You need to realize your worth. You would be shocked at your worth.”
Bluntly, he went on, “Your worth is phenomenal. You provide more value than any other part of the organization. You must demonstrate your worth– your CFO isn’t up at night demonstrating your worth. If your CFO doesn’t know what your value is, your value is zero. And the response to zero value employees is rightsizing!”
He added that automation engineers need to use the same kinds of technology that makes plants work to make business work. “You need to use technology to measure business value,” he said. “Use technology to measure…think beyond that. Use technology to DRIVE business value!” he exclaimed.
What you must do, he said, is to go beyond automation to real business problems that you can solve with automation techniques, and thereby achieve success. “Success is when the top executives in your company use your solutions daily,” Martin said, “and they know the data came from you.”
The two organizations with the most ability to change the enterprise are IT and Automation Engineering, Martin opined, but only if they work together. “When two organizations merge, each tries to submarine the other. Don’t submarine IT, and don’t let them submarine you.”
Martin spoke directly to the end users, “As engineers you are measured on the capital budget. The capital budget is all about ROI. The problem is that when you hit 100% of ROI with a capital project, you don’t get any more credit!”
Martin went on, “Return on investment is always negative. Once you have recouped your investment, you have bottom line value, but nobody measures it– and nobody can see it– and so you don’t get credit for it. All you get is blame for the red line that is the ROI line. ROI is always negative.”
“So how can Invensys help you?” he asked. “We can help you reduce the cost of automation, make the top line measurable, and reduce the lifecycle cost. We know that we can help you explain your worth.”
He explained. “If we were playing baseball, and you were the best hitter on the team– and we weren’t measuring batting averages– how would you know? How could you prove your worth to the manager?”
This is why we came up with the idea of asset performance management, he said.
“There is a tradition of plant conflict. Have you ever noticed? Operators don’t like maintenance. Engineers don’t like IT. Nobody likes accountants. Operations and Maintenance are the two groups that have a larger impact on the bottom line than anybody else. Operators push maximum utilization. Maintenance maximizes availability. These are often mutually exclusive goals. Yet, like a driver and the pit crew in a race, winning companies are tightly integrated. The measure is, is the car good enough to win.”
Martin went on, “Asset utilization and availability are inverse functions. Asset economic value is the middle vector. Real-time accounting is the measure of that vector. When you only manage asset utilization, we call that process management. When you only manage asset availability we call that asset management. When you manage asset economic value, you manage Asset Performance Management.”
Bringing it back home, he said, “If you aren’t the most valuable person in your organization, we aren’t the most valuable supplier in your organization.” He proclaimed, “The tools exist to do this, engineers!”
If you can start measuring asset economic value, Martin said, the average 100% ROI is less than 3 months, with a sustainable positive cash flow for years. In six months you have doubled your investment. In nine months you will have tripled your investment…and if you can measure it, and you can prove the measurements, you will turn rightsizing right around.
Martin went further. “The problem is that there are real barriers to implementation. There are islands in the plant that you need to work with to make this happen. We need to break through the islands. That’s what InFusion is intended to provide you– a platform for interconnection and collaboration between IT, accountants, operation, maintenance and management.
“We began with the concept of SOA– service oriented architecture,” continued Martin, explaining the genesis of the company’s InFusion enterprise control system. “SOA is a paradigm for organizing and utilizing distributed capabilities that may be under the control of different ownership domains. It provides a uniform means to offer, discover, interact with and use capabilities to produce desired effects consistent with mesurable preconditions and expectiations. That’s the accepted OASIS definition. “In other words, we want to bridge the islands– not remove or replace them. We took the [Microsoft] .NET architecture kernel, and wrapped around it the industrial services that are needed to bridge those islands. We refer to that wrapper as ArchestrA,” he said.
However, he noted the problem with ArchestrA is that a service-oriented architecture doesn’t actually do anything. “So we had to do something with it,” he said, “and that is what became InFusion. A real enterprise control system.”
Martin pointed out that users can start using the InFusion tools as they need them, and then start connecting to other systems. “Then you can work into collaboration. Put together collaboration walls, and other tools. Pretty soon, you are doing asset performance management. Because that’s what those executives we talked to want you to do.
“We believe that’s our role,” he said. “If we aren’t driving value for you, we aren’t doing our job. We should be applying the techniques of control to the business. The same processes that you control on the plant floor work at the business level.”
Martin told of talking to Sudipta Bhattacharya, head of supply chain practice for SAP. Bhattacharya, Martin said, says that he is jealous of Invensys because, “You do control, we do management. Do you know what management is? Management is dealing with processes you can’t control.”
“YOU have the keys to the performance of your company in your hands,” admonished Martin in conclusion. “How do you apply engineering techniques to engineer the business? How do you provide clearly visible and measurable results?
“Think broad! Engineering can take the leadership position in our companies. If you can make that transition, you will show your worth to your company. I guarantee it.”